Perhaps you’re living on one income out of necessity – one partner lost a job or is handicapped – or by choice because one wants to stay home with the children.
If you were used to living on two incomes, you will find the adjustment more challenging than those who have always had to live on a single income. But you can use their “secrets” for living well on one income. Or you might be one who is forced to live on a greatly-reduced income because of our hard economic times.
Most of us want to live “comfortably” while saving something for the unknown future. Whatever the motivation, we all enjoy tips for saving money, using money wisely, and spending less without feeling like life is a constant sacrifice.
Every family is different, and everyone has different priorities. By glancing over the headings, you can choose categories that appeal to you. There is something for everyone here.
1. Save on the BIG items like housing, cars, luxury items and vacations.
* Housing: Could you re-mortgage your home at a lower rate? Or trade off for a smaller, less expensive, cheaper-to-maintain housing arrangement? It would be better to think this through before you are forced into bankruptcy. Some people got in over their heads when credit was easy to get, and they cannot enjoy what they have because every cent is going into their McMansion.
Or perhaps you have a second home or cabin somewhere that is used much less frequently. It’s time to seriously reconsider its costs and usefulness.
Even children can sense when times are uncertain and family pressures are building up. One thing many people are being forced to learn is that they can live happily, and more stress-free, on less.
* Cars: Can you get rid of one? Really. Re-think your priorities and actual needs. A car needs maintenance, fuel, annual registration and licensing fees, new tires, a garage or safe area in which to park, etc. Could you both trade-off the use of one vehicle? It could be a little inconvenient but, again, save on stress and its related health-care costs.
Could you use a small scooter, bicycle or motorcycle for a responsible family member? Perhaps you have a college-aged student living at home who goes to school a couple miles away. Perhaps the working member travels a short distance to work and could use a much smaller, much cheaper vehicle most of the time. Motorcycles can carry many small items like groceries, backpacks or briefcases while getting up to 80 mpg or more.
* Luxury items: Do you have a yacht or rarely-used fishing boat? Maybe you have a time-share that you could sell for extra cash for other needs. Do you own large animals like horses? Maybe you’ve got a couple four-wheelers or a skimobile sitting in the garage. It is time to reconsider your priorities, related costs, amount-of-care required as compared to actual-use time.
Some things you took for granted might now have become unnecessary or infrequently-used “luxuries.”
* Vacations: Many people spend thousands every year on planned vacations that end up in disappointment because of high expectations and “forced,” pre-scheduled “fun times.” Because of pre-payments, flight arrangements or down money that “must be used” by certain times, families are caught up in the trap of “ready or not, this must be done.”
More people are finding “stay-cations” – staying at home – much less expensive, less tiring, less “forced” and actually more fun. The family can take day trips, have cookouts, play yard games, use the home or town pool, visit relatives or friends (cheaply), and still have good, relaxing times away from the daily grind.
2. The accumulative savings on many small, ongoing items and services quickly adds up to big savings. You’ve heard these all before, but might not have been quite as motivated to put these into action. Get the whole family motivated with “payoffs” – for example, buying a much-wanted, agreed-upon item with the monthly savings – eating out at a fine restaurant, buying a new large screen TV, or buying a new computer for the whole family.
* With the “bribe” in place, get everyone to cut down on the utility bill – use less water, heat, and electric;
* Turn off unused appliances;
* Replace old appliances (washers, dryers, refrigerators, stoves) with new, energy-efficient ones, as needed;
* Combine the phone, TV, and computer services into one bill;
* Buy all your insurances for your cars and home from the same company; weatherproof and caulk around all doors and windows;
* Replace an old heating system with a newer, much more efficient heater;
* Use water saving showerheads and low-flush toilets;
* Replace every burned out light bulb in the house with the new, compact fluorescent light bulbs (they shine up to the equivalent of 200 watts and come in 3-way bulbs now);
* Replace old, drafty windows with energy-efficient, double- or triple-glass;
* Use the microwave over the regular oven;
* Capture outdoor heat by opening draperies as needed and closing at night to maintain the heat;
* And reverse the process for cooling – open windows at night to capture cooler air and close draperies during the day.
You get the idea. Many people overlook saving the pennies that turn into many dollars with minimum effort by becoming more aware of wasted monthly expenses.
3. Food costs. Planning, buying, cooking and storing food takes up much of our lives. Many people try to cut down on food costs, but they do it ineffectively.
*They buy stuff they know they aren’t going to eat – off-brands, stuff the kids won’t eat unless they’re truly starving – or items that are difficult to fix or take too long to prepare.
*They buy poorer quality foods and lose the nutritional value.
*They overbuy stuff on sale and can’t use it all before the expiration date.
*They buy junk foods that cost a lot and do not really fill anyone up.
* Go food shopping with a full belly. Avoid impulse buys. Pre-plan your meals, including leftovers. Make a grocery list and stick to it, but don’t walk past an overlooked “best buy” item that you’ll be back for next week.
* Avoid eating out. Home-cooked meals cost less and almost have to be healthier than take-out or fast foods that your family may have become addicted to. Try to have the “old family sit-downs” that mean so much to creating a bonded family experience. Share your days together – at least 20 minutes worth – and share your positive feelings about the day over good, healthy food.
* Shop in bulk for non perishables like paper goods, canned foods, spaghetti and sauce, rice, tea, coffee, and pet food. If a $35 annual warehouse club membership sounds like savings to you, go for it. You can also buy large quantities of perishables like meats, cheeses, fruits and vegetables and share with a relative or friend.
* Buy a freezer. It will quickly pay for itself in savings. Wrap and mark items correctly; rotate your stock; use before expiration dates. The same logic applies to refrigerator items: Store in see-through plastic or glass so everyone can see what’s available and eat the food quickly before spoilage.
* Watch for coupons, sale items and in-store specials. Stock up IF you know the foods will actually get eaten before their expiration dates.
* Plant a garden. Children will often eat what they help to grow. Fresh strawberries, tomatoes, potatoes, carrots, etc. will taste better and can be grown healthier, without pesticides. You will know what you’re eating, and it will have more nutritional value. Or shop at someone else’s garden like a nearby farm, farmer’s market or roadside stand.
4. Saving money includes getting rid of old debts that use up your resources. Get rid of credit card debt. This is another biggie for many people who relied on credit in the past. Buy now, pay now. To get rid of old debt, pay down the card with the biggest APR first; put that money towards the next one, etc. Get down to zero and destroy the cards. Then you can start actually saving money and investing it.
5. Save by not spending. This seems obvious, but many don’t do it because they don’t realize what it’s actually costing them. Think about eliminating bad habits – like smoking. If your family is in the 3-pack-a-day crowd, you could readily save over $300 per month that could obviously be used much better elsewhere – like in savings towards the kids’ college fund on in safe CD’s.
Your family will be proud of you, and you will have a healthier home environment for yourself, your family, and your pets. You might save thousands of dollars in health care costs by preventing cancer, heart and lung diseases – that will evaporate savings. And you will, guaranteed, have a better quality life as a nonsmoker.
6. Shop at secondhand stores. Some people balk at this, but it can become a healthy addiction. Gently-used clothing (including name brands), household goods, children’s toys and bicycles, appliances, furniture, kitchenware, books, puzzles, handbags, etc., etc await you in nicely-run businesses like Goodwill and the Salvation Army. Your money helps to hire people, and your savings help your wallet.
Also consider shopping at yard sales and household auctions in upper class neighborhoods. Their present-day need for cash can be your long-term gain. Do not buy non-necessities or get too impulsive; you will become a loser instead of a smart shopper.
If you need to consider selling off things for cash, do it with sincere forethought and not out of last-minute desperation. Liquidate some things that have lost importance and use the cash to pay down debt or put it in savings and make your money work for you.
7. Buy from online stores that often offer free shipping. Comparison shop for purchases over $50. Only buy from trustworthy sites. If they accept credit cards, look for the “s” after the “http” in the heading for “secure.” This is one exception to credit card use and why it’s smart to maintain one active card. The rule is still to live within your means: the item must be a necessity or planned-for, and you must promise to pay off the credit card debt in full before the due date – no carryover debts, no interest charges or extra fees, no chance of a late fee allowed.
8. One of the biggest, personal money-savers for me for the past 25 years has been a reliance on “Consumer Reports” magazine ($26/year for 12 issues). I consider this a smart investment. We have literally saved thousands of dollars by choosing their “best buy” products that have been lab-tested by their independent, consumer-protection organization, Consumer’s Union, located in NY.
From toilet paper to TVs, from air conditioners to autos, from cereals to computers, from detergents to dehumidifiers to debit cards, this magazine gives invaluable information to consumers. Look for them free at your local library, but consider the purchase a worthwhile investment. (Save every issue as reference for about three years. After that, the recommendations become outdated, and CU often updates their tests on popular products.)
9. Be neighborly. Some people call it bartering, but exchanging goods and services among locals or trusted friends can be the way to go. Think what valuable services you can offer to others: babysitting, house-painting, mowing lawns, typing or computer services, grocery shopping for others (while doing your own), transporting folks to health care providers, etc., etc. There is no limit to this.
10. Earn money from home. Many folks have in-home shops for dog grooming, beauty shops, jewelry shops, key making, wood working, car repairs, tax services, child care, dog walking or boarding, etc. Again, the list is endless, but check out the feasibility with local tax codes and county laws first.
Could a portion of your home be used for a boarder, paying relative, or a foster child? Taking in an outsider must always be thoughtfully considered if it requires risks or giving up privacy. Taking in a foster child, for which the state will compensate for the child’s care, requires a strong degree of commitment by the whole family and should not be taken lightly.
Perhaps you could rent out an outbuilding, garage or shed for storage.
There are literally hundreds of ways to save money on necessities: spend less for more by comparison-shopping for deals; buying seasonal items off season and bargaining with sellers; decide – with your new, thrifty mindset – if a purchase is really necessary; prioritize purchases; and always live within your means.
Think outside the box but also apply what you’ve learned over the years and weren’t motivated to do before. By using money wisely, people will learn what our parents and grandparents already knew: a penny saved can become much more than a penny earned if placed into a savings account that accrues interest.
And we can become creative and live much better on much less once we set our minds to it.